Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: TUESDAY, June 26, 1990 TAG: 9006260334
SECTION: VIRGINIA PAGE: B3 EDITION: METRO
SOURCE: MARK LAYMAN STAFF WRITER
DATELINE: LENGTH: Medium
Salem Mayor James Taliaferro told residents of Mason Cove and Glenvar at community meetings last week that the city's tax rates are lower than the county's in several categories. He also said the county's bonded debt - and tax rates - would skyrocket as a result of the Spring Hollow Reservoir and other major capital projects.
Taliaferro told the residents that "these are issues that you should get answers about" before the consolidation referendum this fall.
In a memorandum sent Monday to the Board of Supervisors, Hodge attempted to provide some answers and to correct what he said were inaccuracies in Taliaferro's comments.
Hodge noted that the county's tax rate of $1.15 per $100 of assessed value is three cents lower than Salem's rate. The county's rate will be reduced to $1.13 next year.
And, citing a publication by the University of Virginia's Center for Public Service, he said the county's "effective tax rate" is $1.01 per $100 of assessed value, one cent lower than Salem's.
The effective tax rate takes into account the ratio of assessed values to actual real estate values. Real estate is supposed to be assessed at 100 percent of its actual value. But in reality, assessments usually fall short of that.
Hodge said that, except for the personal property tax rate and the motor vehicle decal fee, taxes and fees generally are lower in the county than they are in Salem.
For example, the county has no admissions tax; in Salem, it's 5 percent. The county's machinery and tools and business license taxes also are lower than Salem's.
The ratio of bonded debt to the total value of real estate is lower in the county than it is in Salem, Hodge said.
For example, the county's general obligation bond debt is less than 2 percent of the assessed value of all real estate. Salem's general obligation bond debt is 4 percent of the assessed value of all real estate.
The county's debt will increase when bonds are sold to build the reservoir. The latest estimate puts the cost of the project at $53 million. But of that, only $15 million would be general obligation bond debt. The balance would be revenue bond debt, which could be repaid without an increase in real estate tax rates.
Salem also is going to have bills for capital improvements in the coming years, Hodge said. Upgrading the city's incinerator will cost $2 million. And it will cost $4 million to cap and expand the city's landfill, he said.
Taliaferro suggested last week that Salem could expand its city council to seven members, with one each from Mason Cove and Glenvar. The five members of city council now are elected at-large.
But County Board of Supervisors Chairman Dick Robers said that would result in "two different ways to vote for representation in the same city."
Robers said he doubted the U.S. Department of Justice would allow Salem to elect five of its council members at-large and two by district. Rather, the entire city probably would have to be divided into districts to guarantee compliance with the "one-man, one-vote" principle, he said.
Hodge's memorandum shows the county is in "excellent financial shape," Robers said.
The meetings in Mason Cove and Glenvar were held to get Catawba Magisterial District residents' views on a proposal to allow them to become part of Salem if Roanoke and Roanoke County consolidate.
Salem is haggling with Roanoke County over how much it would have to pay for that territory. The county recently lowered its asking price to $16 million. It also wants Salem to agree not to accept annexation petitions by Catawba residents for 25 years if the consolidation referendum fails.
by CNB